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Open thread May 26, 2015

Dan Crawford | May 26, 2015 8:41 am

Tags: open thread Comments (8) | Digg Facebook Twitter |
8 Comments
  • Denis Drew says:
    May 26, 2015 at 9:27 am

    I woke up in the middle of the night and thought: Why isn’t union busting (firing organizers, hiring replacement workers) recognized as a genuine form of restraint of trade? It is a form of price fixing — labor and capital are both competing for their share of the consumers’ dollars — and capital is fixing its price higher by fixing labor’s price lower.

    New thought on doubling the minimum wage — after it dropped one-third as average income doubled: marking the minimum wage to market.

  • bkrasting says:
    May 26, 2015 at 9:49 am

    There’s been a lot of discussion on the TPP of late, there is another “deal” being floated with India that I think is interesting.

    Something called a “Totalization Agreement” is in its final stages. There is one aspect that surprises me. A part of the deal would be that Indians, who work in the US for more than 4 years (and pay SS taxes), would get a refund from SS.

    A refund? That would set an interesting precedent. What about the other countries like Mexico, Philippines, China and even Canada?

    And if we offer a refund to Indian workers, what about the many Americans who have worked and contributed to SS, but have not earned the necessary 40 quarters to qualify for SS benefits? Do they also get refunds?

    Is this important? I don’t know, but according to this article $25B is at stake for just India. Add in Mexico and you get to fairly significant numbers (north of $100b).

    SSA assumes that a certain percentage of its current revenues will not result in future benefit liabilities. That assumption would have to be scrapped if the idea of refunds were to become a reality. It’s not just the refunds from the past, it would be all of the future income that is at stake.

    Google India, Totalization Agreement, or go to this article for more info:

    http://www.americanbazaaronline.com/2015/05/20/us-offers-to-pay-social-security-taxes-back-to-indians-who-work-in-the-us-for-at-least-4-5-years/

  • Lyle says:
    May 26, 2015 at 10:00 am

    Dennis: There was a period of time in the UK where unions in general were considered a restraint of trade and therefore illegal. This was repealed in 1871, although Picketing remained illegal for a while. (1875)

  • Jack says:
    May 26, 2015 at 10:17 am

    Lyle, And in Germany trade union reps sit on corporate boards and hold significant power in that manner. So too local governmental authorities. And guess what? German corporations are still amongst the strongest and most profitable.

  • coberly says:
    May 26, 2015 at 10:56 am

    Krasting

    thanks for pointing this out.

    it looks like another attack on SS by the Corporate rulers of the universe.

    it’s a little like as if i had property in texas and paid the required (hypothetical) property insurance, and then when i moved to california demanded i get a refund of the property insurance premiums i had paid in texas.

    the money involved is not enough to benefit anyone… not even the folks who paid the SS “tax”… the only purpose of the provision would be to weaken SS.

    some, perhaps many, of the foreign people paying the SS tax will eventually pay enough to qualify for benefits… which could mean a lot more for them than the value of the tax. i would… and i think SSA does… look at the finances of that and want to convince myself it made sense. i’d probably not want to see a foreign engineer come to america for ten years, pay SS tax, then retire to India (say) and collect SS at the higher “rate of return” that SS provides people with low “life time” earnings (the ten years of our engineers earnings being prorated over an imagined 35 year career)… but these are details fairly easily worked out to assure reasonable fairness.

    which is not what you get from “negotiations” between international business and their representatives in Congress.

  • Denis Drew says:
    May 26, 2015 at 11:00 am

    Lyle,
    I’m trying to come up with every angle I can to make making union busting a felony seem reasonable.

  • Bruce Webb says:
    May 26, 2015 at 12:09 pm

    Lyle that “period of time” started in 1351 with the Statute of Labourors

    Interestingly the Statute and its successors over the next 500+ years criminalized both collective bargaining by workers and wage setting cartels by employers. Yet over all that span of time, and despite enforcement against workers ranging from court fines to actual calling out of the troops (e.g. Peterloo Massacre) there was not a single example of this being enforced against employers. Instead factory owners were free to establish industry wide wage rates and maintain black lists that would bar employment to any worker intrepid enough to demand an ‘above market wage’.

    Which is to say that the whole Econ 101 argument that wages are set via some sort of productivity based bargain between employer and worker in a free market transaction is pure historical bunk. Certainly in England the Thumb of State Power always assisted the Invisible Hand when weighing the Scales of Labor Wage.

    (In this way the Statute of Labourers worked in much the same way as the French law that prohibited Princes and Beggars alike from sleeping under the Bridges in Paris).

  • coberly says:
    May 26, 2015 at 12:32 pm

    Bruce

    thanks for reminding us.

    in particular the “market wage” has always been “bunk” or at least “myth.”

    though it seems to have some basis in reality: people with “high demand” skills can to some extent ask for and get higher wages than people with “lower” skills. this works until the “market” can find a way to make those skills obsolete or at least in oversupply (mass education)

    but yes in general workes take what the bosses are willing to give them. and in the absence of real “labor shortages” (with high demand provided by “others”) the prevailing wage is subsistence or less. maybe to some extent modified by the sense of decency of some employers that creates a modest upward pull on wages even among less decent employers.

    of course i can’t help but add that there are workers who don’t work but think they ought to be paid more. these are the workers that employers are thinking of when they justify low wages.

    there are also people who can’t work for various reasons, including simple failure to find a match between their skills and the market’s needs. i like to think that at one time a “paternal” economy could find work, and pay, for many of those people, and genuine “welfare” for those it couldn’t.

    we had something of a federal effort to do the same thing following the new deal and persisting more or less up to Reagan Revolution, and now seriously in decline partly because of economic conditions changing faster than our ideas, partly because of genuine failures to manage employment and welfare systems, and partly because ot the triumph of the ruling class over the political system and “popular culture.”

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